TransUnion Addresses Challenge of Credit Washing with Fraud Detection Solution

Core Insights - TransUnion has launched a Credit Washing Solution to combat the practice of credit washing, which involves the removal of legitimate credit data from profiles, affecting risk assessments for lenders [1][2] - Approximately 5% of U.S. consumers have had charge-off accounts suppressed for atypical reasons, leading to an estimated $10 billion in debt being erased from credit reports by year-end [1] - There has been a significant increase in charge-off suppressions, with a nearly 700% rise in consumer-initiated suppressions and a 200% increase in lender-initiated suppressions over recent years [1] Group 1: Credit Washing Impact - Credit washing is detrimental to the credit ecosystem, causing lenders to face financial losses due to inaccurate representation of consumer credit risk [2] - Consumers with atypical charge-off suppressions are 3.5 times more likely to charge off a new account within a year compared to those without such activity [2] Group 2: Credit Washing Solution Features - The Credit Washing Solution helps identify high-risk consumers before they become financial burdens for lenders [2] - The solution enables lenders to route potentially high-risk consumers for manual review, optimize credit limits, and reduce early charge-offs [3] - It includes three powerful indicators: Credit Washing Default Score, Tradeline Washing Attributes, and Inquiry Washing Attributes [5] Group 3: Implementation and Delivery - The solution is initially offered as an add-on to TransUnion's credit and model reports and can be utilized during prescreen, prequalification, and portfolio review processes [4] - Additional delivery channels and third-party platform integrations are in development and will be introduced in the near future [4]